NEW DELHI: Reliance Jio Infocomm has informed the telecom department (DoT), sector regulator and security agencies about starting its services pan India from September 5, which includes offering free voice call for life. It also sought cooperation from larger rivals on being given adequate points of interconnect and mobile number portability.

"Considering certain misinformation propagated in the media, the company reiterates that domestic voice calls to any network across the country, both in local as well as while roaming nationally, will be completely free for Jio subscribers forever, that is, even beyond 1 January 2017," the Mukesh Ambani-owned telco said in a statement.

It said data used for the voice calls will also neither be charged nor deducted from the data balance of the subscriber.

The company said it has filed tariff plans for wireless services with the Telecom Regulatory Authority of India (Trai). "With these steps, the company has fulfilled all requirements of Unified Licence for services commencement."

The start of its services fulfil a condition set by incumbent operators for providing the new telco adequate points of interconnection (PoIs), which are needed to complete voice calls. "We expect and hope that following commencement of services by Jio, the incumbent operators would fulfil their obligations to provide adequate interconnection and MNP (mobile number portability) facility," Jio said. "We expect the incumbent operators to fulfil their regulatory obligations in letter and spirit."

Jio test users are facing huge interconnect and MNP issues, and for transparency, it would report operator-wise call failure numbers on www.jio.com, on a regular basis, it said.

On Thursday, Mukesh Ambani unveiled tariff plans under which all subscribers under the 'welcome offer' will be entitled to benefits such as access to unlimited 4G data and national voice, video and messaging services, including national roaming, along with the full bouquet of Jio apps and content, completely free up to December 31, 2016. It added that it will now move all the test users to the Welcome Offer, as the telco stepped up its bid to add subscribers.

Steep breakeven target

Brokerage and equity research firms said that Jio will need to acquire 75 million to 80 million telecom subscribers in two to three years to break even.

IDFC Securities, a brokerage firm, estimated that that the newest telecom company will need at least 75 million subscribers with an average revenue per user (ARPU) of Rs 180 for break-even in earnings before interest, tax, depreciation and amortisation over the next two to three years. "Execution and customer care is the key," it said.

Ambani on Thursday said Jio was targeting a subscriber base of 100 million customers in the shortest possible time but didn't divulge a timeline. The telecom arm of Reliance Industries, which will start commercial operations on September 5, announced free lifetime voice calls and roaming services for users along with data charges at about one-tenth of the prevailing rates.

"We expect growth to be primarily driven by market share shift from fringe players and modest gain from incumbents who have a relatively weak data footprint," IDFC Securities said.

Goldman Sachs concurred with the estimate. In an internal note, the equity research firm said, "Jio is likely to focus on profitability in the medium term. Further, we note that we have EBITDA break-even for Jio by FY-20."